PROVE YOUR SELF SOVEREIGN IDENTITY
When you want to create a system where every person receives one coin per hour, it is obvious that a person should not be able to create more than 1 identity. But when you don’t want corruptible centralized institutes that verify if a person doesn’t create more than one identity (to receive multiple coins per hour), how can you be sure identity fraud doesn’t happen, especially when a person has full control over creating his/her own Self-Sovereign Identity?

The solution to this problem are the “peers”. The peers of a person (especially the closest ones) are the ones to check this. Without coins involved this check would not be very important. But when you do a transaction with a person and there is a risk this person commits identity fraud that can make the value of your coins zero (because others that are aware of the identity fraud wont accept the illegal created coins that are in your possession) then it becomes really important to check if the identity of the person is indeed uniquely used by that person.

This is the reason that people that use this new financial system will first start to interact with their closest peers (like friends and family) and only later – once they amassed a substantial list of transactions that can be properly verified by more distanced peers – with many other people.

The combination of a real Self-Sovereign Identity and the creation of new coins makes it possible that there is an incentive for all participants to be constantly checking if their is no identity fraud. The incentive is that the coins in your transaction are genuine and can actually be used to buy something with.

With very simple software that can run stand alone on every smartphone or computer, anybody can can take a picture, add his name, birthday and some other features as color of eyes, hair and other descriptions that identify you and combine all in one .png image file (see image above). This image is then hashed (sha256) which gives you your 64 hex-characters ID-Code. A hash code is unique for the image and all information that is in that picture. The hash makes it impossible to change the image in a way that the image still generates the same ID-Code. Because the ID-Code is used to store your transactions in what we call “personal blockchains”. A personal blockchain is a personal ledger where all your personal transactions are stored and which also allows you to receive one coin per hour. These personal blockchains are exchanged with all the people you transact with, who also chair their personal blockchains with you. Before you accept a transaction, your app checks if there are no irregularities in the other persons blockchain by cross checking it with all other personal blockchains you have received from earlier transactions.

So you can imagine that it is important that the right ID-Codes of you and all the people you transact with is stored properly in your personal blockchain. If quantum computing would become a real issue, we could simply create larger hashes. But even with quantum computers it would not be feasible to crack hashes, so that risk is extremely low.

Bottom line is that every transaction that you do will prove the validity of your Self-Sovereign-ID more and more. This is because your Self-Sovereign-ID and your participation in the new financial system (where you receive a coin every hour and where you do transactions without any third party interfering) work together in building trust. It is quite an unique and elegant solution which excludes third parties from tinkering with your ID or transactions. If you want to exclude corruption, excluding third parties is a very logical step.


CHANGING YOUR ID-CARD
When you get older, you get married or something else happens that makes you want to change your ID-Card, this needs to be possible. We solved this to turn your ID-Card into a small blockchain itself. When you update your ID-Card, the codes of your previous ID-Card hashes are added to your ID-Card image. We use small squares of 8x8=64 colored pixels that represent the ID-Code of your previous cards. We show these colored squares on your new, corrected, ID-Card and hash it again.


CREATING A BRAND NEW IDENTITY
The type of ID-system we propose is likely the only proper way a real Self-Sovereign Identity can be created. It is the only proper way because no one else can prevent you from creating your own identity, and also nobody can destroy that identity. You yourself are the only one that is in charge and you don’t need anybodies permission to change or renew your ID. Any other ID-systems (the ones where governments or companies are involved in the vetting process) can not be considered as Self-Sovereign Identity systems, simply because these entities take away all or at least an important portion of your sovereignty.

As said earlier, the chance of somebody breaking the hash code of your ID-Card is virtually zero. But even if your hash would be cracked, then it is still quite easy to abandon your just cracked identity and just create a new one. This will cost you the money you might have accumulated, but your peers will allow you to do this when you seem to have a good reason to do so.

Because of the strong depreciation of the coins in our financial system, the fact that you keep participating in the money creation system and you probably own your house and car, you won't have too much to worry about when you start a new identity. However, you also shouldn't think too lightly about changing your identity. The coins you have created with your old identity and you have used to buy stuff, will become worthless. So creating a new identity will also hurt people you did business with. They will probably think twice before interacting with you again if you changed your identity and made their coins worthless. Getting a new identity will have more consequences you might initially think. IDENTITY FRAUD
The major issue with a full Self-Sovereign Identity is this: If you want to attach the property of money creation to our Self-Sovereign Identity, how do you prevent people from creating multiple ID’s to create a multitude of money streams? With for example 5 different identities, you would receive not 1 but 5 coins per hour.

There are several ways multiple identities can be created. You can do it yourself with your actual name slightly or fully changed, or someone that has a picture of you can add his own name or can put your name under a photo of himself. There are many ways to create a false ID with the goal to get one or more extra streams of newly created money.

With a true Self-Sovereign Identity, there is no way to prevent people to create multiple, fake ID's. Because there is no voting system included in our new financial system, organizing a Sybil attack won’t help you. Each of the millions of Fake Identities that you have created first need to be checked by your closest peers, before you can actually use them, and the people that check you, are the ones you affect once your fraud comes out. The cross-check parts of the app that operates your wallet will spot these frauds very fast which means that Identity Fraud won’t be effective.

Created new coins are labeled in a way that they can always be traced back to their originators. This way people are able to decide for themselves if they want to accept coins from an originator they don't know. Only when you are sure the coins are legit, you can start using them or accept them.

The trick to do these cross checks in a decentralized way, is to copy your full personal blockchain and the full personal blockchain of the person you do a transaction with. The open source software that is also used for the creation of coins, copies your blockchain to the person you do a transaction with and also copies his blockchain to your device. The open source software checks the people your transaction partner has dealt with before and verifies these transactions with the transactions that you have done in the past. This way each fraction of coins in possession of your transaction partner can be traced back to its origins. When you have a multitude of mutual acquaintances, the confidence level of these particular coins is high and you can decide only to take these coins, or to take the fresh created coins of your transaction partner, as you can check that the have proper legitimacy. The same open source software checks the value of the coins after depreciation. This is how ID fraud is prevented.


TRACING
In stead of using one synchronized blockchain, users in our financial system just share their personal blockchains at every transaction, which reduces the size of data copying/downloading extremely and makes it possible that the system can be used without the use of the internet. These features are necessary for adoption of this system in remote areas or where the globalists restrain the internet. The collection of shared blockchains allow the app to do cross-checks and to trace any portion of a coin to its origins.


THE CONCEQUENCES OF FRAUD
What will happen if you encounter a person that uses more than 1 ID-Card. What do you do? You probably don’t want to use any of his coins at all. But what if somebody else tries to frame you and uses a copy of your identity?

It is likely that there will be an international register on the internet where you can find instances of people that did fraudulent transactions or used multiple ID-Cards. But also these reports could be fake. How do you know what is true?

In all those cases it boils down to the question which version of the persons personal blockchain survives. And survival of a particular version is in fact a matter of a persons trustees. The people that trust you will allow you to continue with the version you tell them to use, where the others will probably never want to deal with you or any of the other double identities they have encountered. This is the reason that there is probably no need for digital signatures in the transactions.

Committing fraud that in the end is always provable, will cause massive long lasting distrust which seems a bit pointless on a world where most necessities are provided anyway and where money will eventually be more similar to ‘a thumbs up’ or ‘like’.


DON'T WASTE TRUST
Also in the beginning, where people need to get familiar with the system, it seems a bit silly to commit fraud, unless you want to test the strength of the system. In the beginning it is however more important to accumulate trust. And later - when you have a much larger blockchain with many connections - it seems silly to waste that trust on a simple fraud. Being fully transparent and record all transaction is a system that is very different to the secrecy of banks and the untraceable properties of cash. So it will take some time to understand what it means to be trusting our peers.


SECURITY IMAGE
Because of these assumptions discussed above, it seems right to start the system without digital signatures and see how that works in a pilot. Having no digital signatures also avoid all issues with protecting the secrecy of the private digital signature key. Contrary what many cryptocurrency adepts want you to believe is that keeping your private digital signature key safe, is something most regular people won’t be able to do. Especially older or very young people and people with little experience with digital security will likely fail and when they do, lose too much.

We will however look at the possibility to include the possibility to include the hash of a security image in the transaction data. A security image can be the scan of a contract that is mutually signed. But it can also be the hash of a picture where both seller and buyer smile into the camera holding the sold object, both proving the deal is real. The security image will help you to prove to your peers that the transactions you did actually happened so that any arguments about it can be resolved.

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